Welcome to 2022! With the turn of a new year comes an opportunity for Australian business owners to take a few steps back, and assess the overall health and stability of their operations and books moving into the next 12 months and beyond. The pandemic continues to throw challenges of all shapes and sizes at ownership and management, meaning the onus remains inevitably on you as the taxpayer to make sure that your accounts are in suitable order come reporting or audit time.
At Equil Advisory, our expertise lies in assisting both big and small businesses across a wide range of industries with honest and insightful tax compliance information, outsourced CFO operations, SMSF expertise and so much more. As such, we’d like to share some of the top tips from our expert team for getting your taxes in order moving into 2022.
1. Have Your Accounts Centralised and Transparent
You should be able to, as a business owner, look across your accounts and financial statements and immediately get an accurate impression of the operation’s state of health. Ideally, by 2022, all of your Accounts operations should now be paperless, or as close to as possible, and every invoice, and piece of expenditure, is being logged into the appropriate backend software, at a bare minimum. Any appreciation or depreciation of asset value, or potential capital gains from the sale of business assets, must be accounted for. That way, come the end of the financial year (EOFY), or any scrutiny from the ATO, you know exactly where everything is and what it represents.
Unfortunately, we know the reality to be different. Too many individuals and small businesses across the country still stuff receipts into a back-office drawer, with no coherence or coordination. Implementing and streamlining your record-keeping processes are our speciality. It’s so important for taxpayer businesses to have a crystal clear picture of exactly where they’re at before the Australian Tax Office (ATO) comes knocking, or tax legislation changes. Without a transparent picture of your accounts, there can also be no meaningful long-term planning for your business.
The world of DIY taxes and bookkeeping is fraught with confusion, misdirection, disorganisation and last-minuteness. In Australia, corporate tax rates and compliance requirements can change quickly, and it’s easy to get left behind. So create some peace of mind, and clear up the picture by engaging with a reputable financial advice partner, who understands the intricacies of the tax system, such as our Equil team. We allow you to envision a pathway to growth, by creating transparency in your accounts.
2. Reflect On The Learnings & Mistakes of The Past Tax Year
People often take the beginning of a new year to reflect on the learnings and mistakes of the past one within their personal life. There’s no reason why you shouldn’t similarly see it as a chance to reflect on the missed tax and finance opportunities for your business. However, sometimes a reflection can be unflattering. To reflect truthfully on the past tax year often requires the insight and advice of a financial partner such as Equil. We create a chance for ownership and management to see the forest for the trees, using a direct and honest approach to identify shortfalls and clutter, and then create the cleanest solutions.
Even if you’ve created a level of success, there are always new technologies and procedural efficiencies that can be found to create an even greater sense of clarity for your books and growth for your business. It’s no use resting on one’s laurels, especially when your competitors are always seeking new advantages and points of difference. Focusing in particular on the specific learnings of the past financial year, to the end of June 2021, and following two financial quarters can be especially valuable for creating the most appropriate tax strategy for the year to come.
Engaging with an experienced tax compliance and advice partner such as Equil will take so much of the fumbling out of this reflective process. We have experience across such a broad spectrum of industries, and we can cut through the noise to tell you what works. We may even pick up on areas of waste or inefficiency that you hadn’t even considered, allowing you the breathing room to act with decisiveness and surety.
3. Create A Clear Tax Strategy With Your Financial Advisor
Now that we’ve created a clear picture of the numbers, and reflected on the past year’s mistakes, it’s time to make a game plan, if there isn’t one in place already. Having a viable, well-constructed tax strategy in place is non-negotiable if you seek to grow your business finances the right way. In fact, with January already melting away, you should already, right now, be equipped with a clear plan for the next five months, as we accelerate downhill towards another end of the financial year.
Inadequate planning creates headaches for both you and your staff; a mad rush to the end of June as you fumble to get everything in order. What’s worse, you would almost certainly be leaving money on the table as you scrambled. Without the appropriate key tax advice and strategy, you cannot possibly hope to assess all of the options, recoup all of the available returns, or take advantage of all of the available tax credits and incentives – representing a potential loss of hundreds of thousands of dollars. This extends your personal finances as well, with extensive savings to be made in terms of both income tax and superannuation.
As we enter into 2022, now is the perfect time to consult with our diverse team so that we can implement the perfect proactive strategy to maximise the tax return results when it’s time to submit to the ATO. We have assisted our client businesses with direct honesty and expertise that allows us to collaborate on a meaningful and realistic tax plan that we can then help them execute. The potential savings alone make it a no-brainer.
4. Secure Your Tax Information & Communications
As your tax professionals, we are the frontline in protecting some of our clients’ most sensitive information, including personal details, business and income tax information and accounts. To this end, we use the most appropriate, secure and technologically advanced software products to ensure that this crucial information remains private. In the same vein, we recommend to all our partner businesses that they prioritise implementing the correct processes and industry-specific third-party software options that will maintain the highest level of security.
This is no day and age to be lax with your financial records and key accounts documents. You should most certainly not be emailing any such items with this type of sensitive information, whether that be internally or externally. Email is not a secure form of communication, and can represent a potential leak in the pipeline. Instead, consider uploading them securely through the client portal, so that the whole chain links up properly. This extends to your personal finances as well, whether that be super fund information, individual income tax returns, health insurance details, or otherwise.
When it comes to our partner businesses, our expert Equil team understands that diligence and responsiveness are the keys to resolving any potential security issue cleanly and quickly. There’s no time to waste in taking action, and we have the experience and know-how to give our clients the peace of mind that they deserve.
We’re already speeding through 2022 at a rate of knots. Before you know it, the ATO will be knocking on your door again. Take the initiative now. There’s no time to waste for you or your business. Let’s get the books in order, reflect on past mistakes, create a plan and make sure everything’s secure – and that’s just the beginning. There are so many more little tips and tricks we have to ensure that you get the best result when the end of the financial year comes calling.
So speak to our team today and let’s get started.